Legislative

CPUC Issues First License for Ride-Share Company

March 18, 2014
• by Staff

The California Public Utilities Commission (CPUC) has issued the first license for a Transportation Network Company (TNC) to Summon, formerly known as InstantCab. It was issued an operating license after demonstrating to the CPUC that it met all the 28 rules and regulations for TNCs.

In September 2013, the CPUC determined that car-sharing companies such as Lyft, Sidecar and Uber are subject to CPUC jurisdiction. According to the CPUC, the newly created category of Transportation Network Company (TNC) applies to companies that provide prearranged transportation services for compensation using an online-enabled application (app) or platform to connect passengers with drivers using their personal vehicles.

In issuing the license, the CPUC reviewed Summon’s application, which included a driver training program, 19-point car inspection program and providing proof of a commercial liability insurance policy with a minimum of $1 million per-incident coverage.

The CPUC regulations for TNCs include:

Obtain a license from the CPUC to operate in California.

Require each driver to undergo a criminal background check.

Establish a driver training program.

Implement a zero-tolerance policy on drugs and alcohol.

Hold a commercial liability insurance policy that is more stringent than the CPUC’s current requirement for limousines, requiring a minimum of $1 million per-incident coverage for incidents involving TNC vehicles and drivers in transit to or during a TNC trip, regardless of whether personal insurance allows for coverage.

Conduct a 19-point car inspection.

A second phase will review the CPUC’s existing regulations over limousines and other charter party carriers to ensure that public safety rules are up-to-date and responsive to the needs of today’s transportation market. The CPUC can clarify or modify its TNC requirements, if needed.

According to the CPUC, it is currently working with other TNC applicants to complete their applications before issuing operating licenses.

The pilot allows up to four different companies to provide service with a maximum of 500 cars each, and the permits provide access to all of the residential parking zones across the city, except those that have already reached 95% subscription.

With attendees hailing from far away locations such as New Zealand, Israel, Macedonia, Finland, and Sri Lanka, the 23rd annual ICRS provided industry players with the chance to learn, educate, and share ideas about the future of the rental world.